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Physicians' perception of demand‐induced supply in the information age: a latent class model analysis
Author(s) -
Shih YaChen Tina,
TaiSeale Ming
Publication year - 2012
Publication title -
health economics
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.55
H-Index - 109
eISSN - 1099-1050
pISSN - 1057-9230
DOI - 10.1002/hec.1710
Subject(s) - latent class model , supply and demand , categorization , class (philosophy) , health care , medicine , perception , control (management) , association (psychology) , business , family medicine , actuarial science , psychology , computer science , economics , microeconomics , management , artificial intelligence , machine learning , neuroscience , psychotherapist , economic growth
SUMMARY This paper introduces a concept called ‘demand‐induced supply’ that reflects the excess supply of services due to an increase in demand initiated by patients. We examine its association with the proportion of information‐savvy patients in physicians' practice. Using data from a national representative physician survey, we apply latent class models to analyze this association. Our analyses categorize physicians into three ‘types’ according to the frequency with which they provided additional medical services at their patients' requests: frequent, occasional, and rare. The proportion of information‐savvy patients is significantly and positively correlated with demand‐induced supply for the frequent or occasional type, but not among physicians in the rare type. Efforts to contain healthcare costs through utilization control need to recognize the pattern of responses from physicians who treat an increasing number of information‐savvy patients. Copyright © 2011 John Wiley & Sons, Ltd.